Q. I received a notice from IRS. What should I do?
A. The IRS sends a letter or notice to you to request payment for taxes, notify you of
a change to your account, or request additional information. Please review the information
on your entire tax return and compare it with the information on the notice. If the notice
tells you that a correction was made to your account and you agree with the correction, a
reply is not needed unless a payment is due. If you do not agree with the correction we
made, it is important that you respond to the letter or notice as requested. Please call
or write to us and tell us why you disagree so any necessary action can be taken. If you
are due a refund as a result of our adjustment, it will be sent to you unless you owe
other amounts the law requires us to collect (for example, related tax accounts, child
support, student loans, etc.). Notices and refund checks are sent from different IRS
locations. Any refund issued as a result of our change or correction, should be received
within 6 weeks from the date of the notice. Refer to Tax Topic 651, Notices - What to do,
for additional information.
Q. I received a CP 2000 Notice from the IRS. Have these changes
been made to my tax account?
A. This notice informs you of the proposed changes to income, payments, credits, or
deductions, and the amount due to the IRS, or refund due to you. It is normally a five to
six page letter. Refer to Tax Topic 652, Notice of Underreported Income - CP 2000, for
Q. Can you explain IRS' penalty and interest charges?
A. Interest is charged on any upaid tax from the due date of your tax return until the
date of payment. The interest rate is determined every 3 months. If you file on time but
don't pay on time, you will generally have to pay a penalty of ½ of 1% of the unpaid tax
for each month or part of a month the tax remains unpaid. If you owe tax and don't file on
time, the penalty is higher. For more details, refer to Tax Topic 653, IRS Notices and
Bills/Penalty and Interest Charges, Publication 594, Understanding the Collection Process,
or Publication 17, Your Federal Income Tax.
Q. I just received an IRS notice indicating changes were made to
my return, but it appears an attachment to my return which explained the entry changed by
IRS, was not considered. What should I do?
A. If you believe the IRS made a mistake with the figures, or didn't consider some
important information, call the IRS at 1-800-829-8815 to discuss the matter. If possible,
please have a copy of your tax return and the notice when you call. For additional
information, refer to Tax Topic 654, Notice of Change to Return.
Q. I received an IRS notice resulting from correspondence I sent
regarding a change to my return. The notice includes additional penalty and interest
charges. How are the penalties and interest figured?
A. Interest is charged on any unpaid tax from the due date of the return until the date
of payment. The interest rate is determined every three months and is the federal
short-term rate plus 3 percent. Interest is compounded daily. In addition, if you filed on
time but didn't pay on time, you will generally have to pay a late payment penalty of
one-half of one percent of the tax owed for each month, or part of a month, that the tax
remains unpaid after the due date, up to 25 percent.
The one-half of one percent rate increases to one percent if the tax remains unpaid
after several bills have been sent to you and IRS issues a notice of intent to levy. For
additional information on IRS Notices and Bills/Penalty and Interest Charges, refer to Tax
Q. The IRS sent me a letter that included an additional amount of
tax due. I read the explanation on the letter, but I do not agree with the changes which
were made. Should I file an amended return?
A. If you believe the IRS made a mistake in the figures, call 1-800-829-8815 to discuss
the matter before filing an amended return. If possible, please have a copy of your tax
return, and the notice when you call. For additional information, refer to Tax Topic 656,
Notice of Change to Return - CP 11.
Q. I received an IRS Notice titled, "We Corrected Your
Return - Amount Due IRS." It appears I did not get credit for one of my federal tax
deposits. What should I do?
A. If you account has not been credited with all of your deposits, call the toll-free
number on your notice to discuss the matter. Please have the notice and a list of your
deposits when you call. For additional information, refer to Tax Topic 657.
Q. I got a notice from IRS saying they changed my account and I
am due an additional refund, but I haven't received the check yet. What should I do?
A. Allow at least two weeks from the date of the notice, for your refund to be mailed
to you. We could not include the check with your notice, because checks are processed in a
different location and mailed by a different system. If it has already been longer than
two weeks, please call us at the toll-free number listed on your notice. If possible,
please have a copy of the IRS notice and a copy of your tax return when you call.
Q. The IRS corrected my return and sent me an additional refund.
Does this mean I am also entitled to an additional refund on my state tax return?
A. Whether you are entitled to an additional state tax refund depends on the nature of
the change which was made to your federal return. For example, if on your federal tax
return, you used the wrong line on the tax tables to figure your tax, this may not have an
impact on your state tax return. However, if the change was made to the amount of your
taxable income on your federal return, it may have an impact on your state tax return.
Contact your state tax office for additional information. It is helpful to have a copy of
your tax returns (federal and state) and a copy of the IRS notice when you call.
Q. I received an IRS bill for an amended return I filed. I am not
able to pay the whole amount at this time. Will the IRS allow me to make monthly payments?
A. For a fee, the IRS may be able to offer an individual payment plan based on monthly
installments. Refer to Tax Topic 202, What to Do if You Can't Pay Your Tax, for more
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